A new tax fling season has begun with the start of this new year. Typically, each tax year sees many taxpayers apply for Refund Anticipation Loans (RALs) or also known as Rapid Refunds. RALs are typically short-term loans given out by tax preparers in collaboration with fnancial institutions to taxpayers based on how much tax refunds they are due to receive. However, the situation this year has changed. Starting from this tax year, RALs are going to get harder to come by. This is because of two major factors.
Firstly, in August last year the IRS has informed everyone that it will no longer furnish taxpayers’ ‘debt indicators’ which is normally used by tax preparers and associated fnancial institutions as part of their process of giving out RALs. Without the ‘debt indicators’ it would be impossible for tax preparers and banks to ascertain accurately the amount of debt the taxpayer may have outstanding. These debts would be payable out of the taxpayer’s refund amount.
Please see full article below for more information.
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Finance & Banking Updates, Tax Law Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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